Dolby AC-4 can have up to 5.1 core audio channels which all Dolby AC-4 decoders are required to decode.[1] Additional audio channels may be encoded as side signals which Dolby AC-4 decoders can optionally support which would allow for the delivery of 7.1.4 channel audio.[1] Side signals may also contain audio objects.[1] Dolby AC-4 has two different channel based encoding tools with Advanced Joint Channel Coding (A-JCC) used for low bit rates and Advanced Coupling (A-CPL) used for high bit rates.[1] A-JCC doesn't support side signals and is limited to 5.1 channel audio while A-CPL does support side signals.[1] Dolby AC-4 supports up to 7 audio objects with a core decoder and can optionally support additional audio objects with a more advanced decoder.[1] The use of different decoders allows Dolby AC-4 to support lower cost devices while also allowing for more advanced decoders for AV receivers.[1]

Dolby states that Dolby AC-4 provides a 50% reduction in bit rate over Dolby Digital Plus.[1] When Dolby AC-4 was tested by the DVB the MUSHRA score was 90 at 192 kbit/s for 5.1 channel audio.[1] When tested for ATSC 3.0 the bit rates needed for the required audio score was 96 kbit/s for stereo audio, 192 kbit/s for 5.1 channel audio, and 288 kbit/s for 7.1.4 channel audio.[1]

Dolby AC-4 is extensible and audio substreams allow for new features to be added to Dolby AC-4 while maintaining compatibility with older decoders.[1]

Dolby AC-4 is covered by patents and requires a license from Dolby Laboratories.[6] Dolby AC-4 has a consumer royalty rate of US$0.15 to US$1.20 depending on the type of device and volume of sales.[6] Dolby only charges for one technology per device, which means that Dolby AC-4 effectively costs nothing in devices that include existing Dolby technologies such as Dolby Digital Plus.[6] The professional royalty rate is up to US$50 for an eight channel transcoder.[6]